In trading on Wednesday, shares of the BBAX ETF (Symbol: BBAX) entered into oversold territory, changing hands as low as $24.14 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of BBAX, the RSI reading has hit 28.2 — by comparison, the RSI reading for the S&P 500 is currently 42.6. A bullish investor could look at BBAX's 28.2 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), BBAX's low point in its 52 week range is $21.94 per share, with $26.821 as the 52 week high point — that compares with a last trade of $24.17. BBAX shares are currently trading off about 1.9% on the day.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.